22 Red Flags That Can Cause a Home Inspection to Go Wrong

If you’re buying a brand new house or selling your property, you will have to conduct a home inspection. The inspection process is essential if you’re the one who’s buying, as you can make sure that you’re not making a significant investment in a home that has significant issues. 

Potential red flags that can arise during a property home inspection include evidence of water damage, structural defects, problems with the plumbing or electrical systems, and mold and pest infestations. The presence of one or more of these issues could be a dealbreaker for some buyers.

If you’re buying a home, it may seem like forking out an extra $300-$500 home inspection cost is an expensive outlay to get the house inspected, especially if you may not even purchase the home at the end. Yet, it may be the wisest money you’ll ever spend.

Before you sign on the dotted line, you get an expert to check the house for structural and safety issues that could cost you a penny later down the line. You can fix some of these problems with a small TLC; others render the home practically unlivable and require immediate repair if they find serious issues.

Understanding Home Inspection Findings

All home inspections are subjective, and no two inspectors will write an inspection report with the same terminology. If you’ve had a home inspection and the results seem alarming to you, there are some questions you need to consider before making a final purchase decision.

  1. Is the deficiency a code violation? All existing homes likely have some building code violations. This is because building codes are updated every few years. Building code enforcement only applies to new building construction or renovation projects that exceed cosmetic improvements.
  1. Is this a structural deficiency? A structural deficiency typically refers to the failure of a building component. This can include wood rot or other damage to foundations, framing, or subflooring. It can also include a repair that is not done using good building practices.
  1. Is this a safety hazard? A safety hazard is any condition that could cause harm to you or other people. This can include uneven walking surfaces, electrical shock hazards, and missing smoke detectors. These safety hazard notes are not necessarily an indication a repair is needed. It’s more so a “for your information” statement to alert you that the condition exists. These are generally labeled as “Safety Concerns”, “Improvements”, “Recommended Items”, or some similar variation in your home inspection report.
  1. Is this a cosmetic concern? Cosmetic concerns are typically referred to as non-structural defects that are a matter of taste or age. Wall and ceiling cracks are common items that reported in error.
  1. Does this aging system require an update now? All systems in a home have a limited lifespan. In a home inspection, a home inspector will typically cite the age of the system and if it is working properly on the day of the inspection. No one can predict when a repair or replacement will become necessary. I’ve seen water heaters 30 years old still be in good working order and I’ve seen heat pumps fail in as little as 6 years.
  1. Is the home priced accordingly for the condition of the house? This will vary widely based on where you live. The real estate appraiser’s role is to establish market value based on what similar homes in size and age range have sold for.

This article will look at 22 red flags that can cause a home inspection to go wrong and tips on spotting these issues for yourself. Let’s jump into it.

1. Water Damage

leaking water heater

First thing’s first, let’s start with one of the most serious and financially damaging home inspection issues – water damage. As you will see throughout this list, most of the issues we discuss will revolve around some form of water damage. 

When water gets into a home’s foundations and has no way of draining out, it can cause many issues. Most of these problems are significant red flags when buying a property. For example, standing water underneath the building can damage the foundation and cause your home to be unstable. An unstable foundation is subject to movement, which will affect the entire house.

On top of that, dampness in the crawl space and water that fails to drain away from the foundation can cause mold and rot, further increasing your problems. It doesn’t take an expert technician to know that this is bad news. 

One of the main reasons water damage is a red flag is the high cost of the repairs.

According to WaterDamageDefense.com, in 2013, water damage and mold cost the insurance industry $2.5 billion per year.

According to InsuranceBusinessMag.com, in 2017, the total amount of insurance payouts for water damage was $13 billion. The average claim costs about $10,000.

According to HomeAdvisor.com, in 2020, The average homeowner spends between $1,142 and $4,732 to restore or repair water damage, with an average of $2,930.

2. Structural Issues

Issues that affect structural integrity should certainly send alarm bells ringing. Assessing the property’s structural integrity is by far the most crucial aspect of a home inspection that determines the strength and potential longevity of the property. Still, it also assesses its safety for the inhabitants. 

All residential buildings have foundations, walls, floors, and roofs. If one or more of these critical features are damaged, it would undoubtedly constitute a red flag on the home inspection. Here are some things to look out for when assessing the structural integrity of the home: 

  • Cracks in the walls
  • Uneven flooring
  • Windows and doors that don’t shut or fit properly
  • Issues with the foundations
  • Misaligned porch of front steps leading to the property
  • Gaps in the mortar and brickwork

If you notice any of these things around the residence, you should point this out to the home inspector and potentially negotiate a repair with the owner. Of course, the severity and whether or not it is a safety issue. 

If you are the seller in this scenario, having a home inspection allows you to repair these problems before listing the property on the market. Most general home inspectors are not qualified to comment on the house’s structural integrity. They can only identify and describe potential issues and then recommend a full structural home inspection to be carried out by a professional structural engineer.

3. Grading Around the Home

Old House

It’s vital to assess the grading of the landscape that surrounds the property. Often overlooked aspect of home inspections, but ignore it at your peril. The gradient plays a significant role in how water drains around your home, especially during floods or storms. If the gradient slopes towards the building, this is a negative gradient and is a huge red flag during a home inspection. 

It’s pretty simple; water needs to flow away from home. Groundwater pools around the house, causing water intrusion in basements and foundations. The longer this groundwater stays in contact with the foundations, the higher the likelihood that they will start to erode and break down. 

Furthermore, excess water near the foundation walls of your property can loosen the surrounding soil, which could lead to the house settling and the foundations shifting. When foundations move, this has a knock-on effect causing substantial structural issues throughout the rest of the house.

4. Roofing Issues

If you’re contemplating buying a new home, you must take some time to inspect the roof. It’s one of the most critical factors in protecting your home from weather conditions, water damage, heat loss, and it also denies pests and easy entry into the house. 

Checking to see the structural integrity and strength of a roof is not something you can do quickly from the outside, so it’s crucial to get a thorough and proper roof inspection. A roof falling apart may look just fine from the outside, but things can start to look a little different once you get into the attic. 

Here are some things to watch out for when appraising the condition of a roof: 

  • Leaks. A leaking roof can be like an onion. Layers of problems can arise including concealed damage inside attics and walls.
  • Problems with the gutters and drainage system. Gutters are often the one area of roof maintenance that is often overlooked. Cleaning gutters is a tedious and messy task. However, when gutters are clogged and water can’t drain properly, they will overflow and can rot out the eaves and roof sheathing.
  • Cracked or curling shingles. As shingles age, they literally bake in the direct sunlight. As the materials dry out, they will shrink causing the shingles to crack along ridges and valleys. The edges can also curl, allowing water to seep behind the shingles. Older shingles are particularly susceptible to damage caused by wind and hail.

Ideally, your home inspectors should give you a rough estimate of how many good years the roof has left after they have assessed it. A general rule of thumb is that roofs generally have a lifespan between 20 to 30 years, depending on the roofing material, maybe longer.

If you’re buying a home, it is usually better to buy an older house with a new roof than to purchase a new home with obvious roofing issues, primarily because roofing repairs are the most expensive repairs you can conduct.

According to RoofingCalc.com, a roof replacement can run $5000 on the low side to $15,000 on the high side. Some roof replacements can be much more depending on the complexity of the roof configuration.

According to HomeAdvisor.com, the average homeowner spends about $8,500 for a new roof, and most pay between 5,601 and $11,733.

5. Mold Mitigation

Mold issues usually come hand in hand with water damage. In extreme cases, mold removal can cost upwards of $10,000, so any hint of mold should be considered a major red flag in a home inspection. 

More often than not, mold is an indication that the building is falling into a state of neglect. It smells rather bad, but it’s unhealthy to inhale harmful types of mold spores. If left unchecked, it can lead to various discernible health conditions ranging from skin irritation to severe respiratory problems. 

Sometimes, mold build-up could come down to a lack of cleaning that you can remedy in an afternoons’ work. However, this typically indicates something more severe if the mold is because of a lack of ventilation, an unrepaired leak, or any other form of water damage.

Mold remediation often involves removing and discarding the affected materials, such as drywall, wood trim, carpeting, etc.

According to HouseLogic.com, You can expect to spend $200 to $600 for a site visit from a qualified mold inspector, which will take 2 to 5 hours.

According to HomeAdvisor.com, in 2020, the average cost for mold remediation is $2,221. Typical budgets range between $1,116 and $3,337 or $10 to $25 per square foot. Removal projects under 10 square feet cost as little as $50. Larger jobs may cost upwards of $6,000.

Most home inspectors are also certified to perform mold inspections. However, not all are. A home inspector is not required to document environmental concerns like mold under the Standards of Practice.

Specialized training is required to perform a mold inspection. A home inspector who is not trained in mold inspecting should refer any questionable findings to a qualified mold inspector.

6. Termites and other Wood Destroying Organisms

The most common wood-destroying organism is termites; however, there are others. As most people know, it’s tough to keep your home completely pest-free, especially during the summer. Yet, you won’t need a professional home inspector to tell you that a pest infestation is terrible news.

The severity depends on the pests and how far the infestation has gotten.

In general, wood-destroying organisms such as beetles, carpenter ants, and termites can be devastating to a home’s structural systems. If they are left unchecked for an extended period, they cause irreparable damage to the beams, walls, flooring, and foundation. 

One of the worst pests to look out for is termites, where a professional termite inspection comes into play. These tiny insects are responsible for a reported 5 billion dollars worth of damage to US property each year, mainly because they attack the critical support structures in the house. 

This is another major red flag that will often be a dealbreaker for most home buyers since lenders will usually not lend money on the house with an active infestation.

Here are the main signs that you’re dealing with a wood-destroying organism infestation in the house:

  • Evidence of nesting, mud tubes, and other remnants of activity.
  • Physical damage to structures in your home (mainly wooden structures) 

According to Orkin.com, termites and similar pests cause an estimated $30 billion in damage to crops and man-made structures in the USA alone. A homeowner who discovers termite damage will spend an average of $3,000 to repair the damage.

According to HomeAdvisor.com, in 2020, a termite treatment costs between $220 and $908, or $561 on average. Cost depends mainly on the size of the home and location. 

7. Obsolete Plumbing Systems & Issues

old house plumbing

Plumbing issues are a significant red flag during the home examination. As mentioned a few times already, water damage is a homeowner’s worst enemy, and faulty plumbing systems are one of the prime suspects for leaks. 

The majority of the pipework is located underneath the floorboards, making them notoriously difficult to repair. In addition, problems can go unnoticed for a long time, usually until they create cross-connection issues or structural damage to the walls, flooring, and foundations. 

Some issues can easily be repaired and could be a trivial concern negotiated with the homeowner. If all of the toilets, sinks, and pipes aren’t working correctly, the property is dealing with a larger scale problem. 

Here are some telltale signs that you’re dealing with a problematic plumbing system: 

  • Constantly dripping or leaking faucets 
  • Moldy smell throughout the house 
  • Low water pressure
  • Poor drainage 
  • Evidence of leaks
  • Abnormally high water pressure 
  • Sediment build-up 
  • Rust 

Some issues require a plumber to repair and could cost upwards of $10,000 or more.

According to HomeAdvisor.com, in 2020, small plumbing jobs cost between $353 and $1,836, with an average of $1,076. Repiping an entire home will run anywhere from $1,500 to $15,000. The cost will depend on your area and how much you must replace piping.

8. Obsolete Electrical Systems

2-prong-outlet

Similar to the plumbing issues listed above, having a faulty electrical system in the house can be extremely expensive to repair. These issues are notoriously hard to rectify, as wiring systems are often sophisticated and poorly organized. 

Furthermore, faulty electrical systems are hazardous and present a genuine fire risk. Over 50000 home fires occur in the USA because of electrical issues, predominantly down to outdated and inadequate wiring that has failed to keep up with the modern-day safety standards. 

More often than not, homes that predate 1960 do not meet code, and the building’s entire electrical system needs updating, requiring the upheaval of floors and the knocking down of walls, and can cost anywhere from $5,000 to upwards of $30,000 or more. 

Home inspectors will closely examine the electrical system to determine overall conditions and defects. Nevertheless, here are some issues that you can look out for yourself when choosing a property: 

According to HomeGuide.com, the cost to update electrical home wiring ranges from $2,000 to $9,000 on average, with most homeowners spending $2.65 per square foot. Electrical upgrades will vary based on the size of the house and the complexity of the project.

9. Obsolete Heating & Cooling Systems

Your home HVAC system is essential for regulating the air temperature and controlling humidity in the atmosphere. These units require regular maintenance to perform at their optimal level. During the home inspection, the assessor will usually take note of the electrical systems that lead up to HVAC systems, the ductwork that runs through the home, furnace faults, and the overall ventilation of the property. 

Inadequate ventilation can lead to mold and water damage problems, which, as you know, are two of the other red flags on our list.

In addition to this, homeowners should be changing the system’s filters at least once every three months to keep the air quality as it should be. If they have failed to keep up with this regular maintenance, there are other issues throughout the home.

According to HomeAdvisor.com, in 2020, the cost to replace an HVAC system averages $7,000, with a typical range of $5,000 to $10,000 per-system cost estimate. Some homes will require multiple systems. This estimate does not include ductwork replacement which averages about $2500 per system.

10. Failing Exterior Siding

If the home you’re buying has failing exterior siding, you may be required to have it repaired or replaced before closing on the house. This can cost several thousand dollars, so you’ll need to factor that into your budget.

If the home you’re buying has failing exterior siding, you may be required to have it repaired or replaced before closing on the house. This can cost several thousand dollars, so you’ll need to factor that into your budget. You may also be required to have a home inspection before closing on the home. This can cost several hundred dollars, so you’ll need to factor that into your budget.

window sweating

11. Old Windows

Old windows can let in cold air and make it difficult to heat the home during colder months. Old windows with single-pane glass are not energy efficient and are often painted shut, which can be a safety hazard if escape is needed during a house fire.

Newer energy-efficient windows can cost $500 or more per window. Specialty windows like large bay windows or picture windows can cost $1500 or more per window.

12. Chronic Wet Crawl Spaces

A chronic wet crawl space can cause damage to wood floor structures, floor insulation, foundation settlement, mold in crawl spaces, and much more.

Wet crawl spaces are typically a result of poor drainage or high groundwater content if you live in a flood zone. The only sure way to correct a chronic wet crawl space is crawl space encapsulation, which can be $8,000 to $15,000 or more. Some large crawl spaces can cost upward of $30,000.

13. Failing Septic System or Sewer Line

An old septic system can fail and cause sewage to back up into the home. If you are buying a home with an old septic system, have it inspected by a qualified septic contractor before you close on the deal.

Septic systems are typically not inspected in a home inspection. However, a home inspector will note observed backups in the waste piping. Don’t ignore recommendations for further examination as this could be a sign of a more serious issue.

Some home inspectors do offer ancillary services like sewer scoping, where a camera is inserted into the waster piping to examine the lines for tree roots and blockages.

A bad septic system can cost upwards of $30,000 to replace, so it’s something you’ll want to avoid if at all possible.

14. Poor Water Quality from a Shallow Well

If the home you’re buying is on a shallow well, it’s crucial to have the water quality tested before closing the sale. Shallow wells are more susceptible to contamination than deep wells, so you’ll want to make sure the water is safe to drink.

A water test will typically cost around $300, and it’s worth every penny to make sure you’re not inadvertently buying a home with water that could make you sick. Bacteria and sulfur are some of the main concerns with shallow wells.

Sulfur can cause a “rotten egg” smell in your water, making it unsuitable for drinking. Bacteria can come from animal feces from nearby farms that get into the water supply.

A new deep well can cost $6,000 to $10,000 or more.

15. Outdated Water Heating System

If the home you’re buying has an outdated water heating system, it’s important to have it inspected by a qualified plumber before closing the deal. Old water heaters can develop sediment and rust inside the tank that can cause hard water that can stain plumbing fixtures and become unsafe to consume.

If the water heater is more than 20 years old, it’s safe to presume it’s time for a replacement. A new water heater will cost around $2000, so you’ll need to factor that into your budget.

A tankless water heater can cost upward of $4000, and some feature recirculation systems. In larger homes with multiple water heaters, costs can compound quickly.

16. Asbestos in a Home

If the home you’re buying was built before 1989, it may contain asbestos. Asbestos is a hazardous material that can cause lung cancer, and a qualified contractor should remove it.

Asbestos can be found in many building products. Some of the most common include:

  • Popcorn ceilings
  • Floor tiles and glue
  • Insulation
  • Siding
  • Roofing materials
  • and many more

If the home does contain asbestos, it will need to be remediated by a qualified contractor. The cost of asbestos removal can vary widely, but it’s typically several thousand dollars.

17. Unpermitted Building Additions

If the home you’re buying has not properly permitted additions, it’s important to have them inspected by a qualified contractor before you close on the deal. Unpermitted building additions can be a fire hazard, and they may not be up to local building codes.

If the home has unpermitted building additions, you may be required to have them removed or brought up to code before you can close on the house, which can cost several thousand dollars.

18. Amateur & Subpar Workmanship of Repairs

If the home you’re buying has had any repairs done, it’s important to have them inspected by a qualified contractor before closing the deal. Amateur workmanship can be a fire hazard or lead to structural failure.

If the home has had any repairs done, you may be required to have them redone by a qualified contractor before you can close on the house. This can cost several thousand dollars, so you’ll need to factor that into your budget.

19. Rodent Infestations

Rodents can carry diseases, and they can cause a lot of damage to a home. If you see any signs of rodent activity, have the seller address the issue before you close on the house.

If the home you’re buying has a rodent infestation, you may be required to have the house treated by a qualified exterminator before closing on the home. This can cost several hundred dollars, so you’ll need to factor that into your budget.

If the home you’re buying has a rodent infestation, be sure to have the house treated by a qualified exterminator before closing on the home. This can cost several hundred dollars, so you’ll need to factor that into your budget.

20. Dated Kitchens and Bathrooms

If the home you’re buying has dated bathrooms or kitchens, you may be required to update them before closing on the house. This can cost several thousand dollars, so you’ll need to factor that into your budget.

Dated bathrooms and kitchens can be a turnoff for potential buyers, so if you’re planning on selling the home in the future, you may want to consider updating them. This can cost several thousand dollars, but it will be worth it when you sell the home.

If the home you’re buying has dated bathrooms or kitchens, you may be required to update them before closing on the house. This can cost several thousand dollars, so you’ll need to factor that into your budget.

Dated bathrooms and kitchens can be a turnoff for potential buyers, so if you’re planning on selling the home in the future, you may want to consider updating them. This can cost several thousand dollars, but it will be worth it when you sell the home.

21. Prior Meth House

If the home you’re buying was a former meth house, you might be required to have it professionally cleaned before you can close on the home. This can cost several thousand dollars, so you’ll need to factor that into your budget.

If the home you’re buying was a former meth house, you might be required to have it professionally cleaned before you can close on the home. This can cost several thousand dollars, so you’ll need to factor that into your budget.

You may also be required to have the home tested for meth contamination before closing on the house. This can cost several hundred dollars, so you’ll need to factor that into your budget.

22. High Radon Levels

Radon is a chemically inactive gas that is released from the earth. Breathing in hazardous gases is the most frequent way to be exposed to radon. Radon has been discovered in all 50 states at high levels.

However, high radon levels are rare. Every home in mid to high-level radon-prone regions should be tested. Radon causes approximately 20,000 fatalities each year. If a property’s radon gas levels are extremely high, it will require a radon gas mitigation procedure to be implemented.

If the home you’re buying has high radon levels, you may be required to have a radon mitigation system installed before you can close on the home. This can cost several thousand dollars, so you’ll need to factor that into your budget.

You may also be required to have the home tested for radon before you can close on the home. This can cost several hundred dollars, so you’ll need to factor that into your budget as well.

home inspection

Home Inspection Red Flags & Repair Costs

Here is a list of the common home inspection red flags listed above and the average repair cost in the USA. These are average and could fluctuate primarily based on the state you resided in and the complexity of the repair.

Home Inspection Red FlagCost of Repair
Water damage repair$1,000 – $10,000+
Structure repairs$1,000 – $10,000+
Termite treatment$200 – $1,500
Electric system rewiring$2,000 – $9,000+
Installation of a new plumbing system$1,500 – $15,000
Mold removal$1,500 – $3,000
Roof replacement $5,000 – $15,000+
New Windows$500 – $1,500 each
Crawl Space Encapsulation$5,000 – $15,000+
New Septic System$6,000 – $10,000+
New Deep Well
New Water Heating System$2,000+
Asbestos Mitigation

When to Walk Away After a Home Inspection

It’s important to remember that no house is perfect, including new ones. People build houses, and people aren’t perfect. You can fix all items in home inspection reports.

The information in an inspection report allows you to set the terms that you can accept. Most purchase agreements have a home inspection contingency. If you have a set of terms in mind and the seller agrees to those terms, don’t try to squeeze out more concessions and turn sour negotiations between you and the seller.

Remember, the goal is to purchase the house for your family. You’ve come this far. Don’t let greed cause you to lose the home you otherwise love by pushing too hard. Count your victories and move on.

Be Willing to Walk Away

Once you obtain a licensed contractor’s repair bid and have a firm number in mind, it’s time to negotiate. To give you some room to maneuver, ask for slightly more, allowing room for a seller’s counteroffer, and eventually, you should end up close to your desired number.

If seller negotiations aren’t going well, you fear losing the house if you can’t make a deal.

Being an excellent negotiator means taking all the emotion out of your decisions. You may need to be willing to walk away. Frequently, if a seller senses you’re about to walk away from the deal and risk losing the contract, their willingness to meet your request may change.

Remember, local market conditions can play a role as well. If you’re in a multiple offer scenario, sellers are less likely to negotiate home inspection repairs because they have backup offers waiting in the wing.

 Summary

A home inspection highlights potential property issues, some easily visible and some not. These assessments sometimes call attention to red flags, such as water damage, mold, and faulty electric and plumbing systems.

Whether these red flags represent a home inspection deal breaker for the home buyer largely depends on expectations and the severity of the issue. For most of these problems listed in this article, the repair cost is relatively high, which may result in a buyer asking the seller to drop the asking price or other concessions. 

Photo of author

Hubert Miles

I've been conducting home inspections for 17 years. I'm a licensed Home Inspector, Certified Master Inspector (CMI), and FHA 203k Consultant. I started HomeInspectionInsider.com to help people better understand the home inspection process and answer questions about homeownership and home maintenance.
DISCLAIMER: The content published on HomeInspectionInsider.com is not professional advice. You should consult with a licensed professional and check local permit requirements before starting any project.
HomeInspectionInsider.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. We also participate in other affiliate programs with other affiliate sites. We are compensated for referring traffic and business to these companies.